5 Things To Know If You Want To Sell In A Hurry

The real estate market is rolling along and homes are selling. If you are in the market to buy a home, sell a home or are simply watching trends in your area, you are probably seeing a mixture of some homes that sell and some that don’t. I have had regular conversations with clients who comment on homes they are seeing on line that were there 4, 5 and 6 months ago.

However, homes in the Portland area are selling and if the proper steps are followed, yours can sell to. Here are 5 things to consider if you need/want to sell quickly:

1. Price in Front of the Competition

Selling a home in a down market almost inevitably means settling for a disappointing price. To move your home you may need to price your home 10% to 15% below what comparable homes in your neighborhood recently sold for. You still may not be able to compete with the foreclosures or short sales in the Portland area, but at least you will have a chance. Recent experience has shown me that when a listing is priced correctly, although it may still procure a low original offer, that the buyer is usually willing to come up and usually to a point very close to the asking price. I always prepare a seller for a low initial offer when we go on the market. I simply explain that the buyer doesn’t know that you won’t accept the offer so they feel it necessary to try. When we respond with a fair counter offer and explain that we are serious but not desperate, we usually find ourselves in an accepted position.

2. Outside Fixes Have The Largest Impact

Since your home will not be cheaper than the distressed property down the block or across the street, it has to look far better. You may not have the cash on hand or the time to remodel the Kitchen or Bathrooms, so focus you attention on cosmetic improvements that will bring the most buyers to your door. Remember, good marketing has the impact of getting as many eyeballs as possible on your home. We both have ownership in that objective and yours is to make the place look appealing.  Spending as little as $1,000 can go a long way to improving your homes exterior. You should consider having your home power washed, maybe paint the front door, clean the moss off the roof, or simply freshen up your landscape.

3. First Time Home Buyers Are Your Friends

Today probably the best way to market your home is to target First Time Home Buyers. In the U.S. this year, first time home buyers are probably responsible for 50% of homes purchased, largely due to the First Time Home Buyer Tax Credit. Another reason this category is out there in numbers is that they don’t have a home to sell so there is very little stopping them from jumping into home ownership. Here is a secret. If you are active on sites like Twitter, Facebook, etc, make sure your agent is giving you a link you can post yourself so your friends, family and others can see what you have to offer. Let them know about Open Houses, Price Changes, Ammenties, etc.

4. Online Tips Will Make Your Home Pop!

Buyers are faced with thousands of listings every time they go to their computer. Make sure your Agent/Broker is using key words that will get the publics attention. Key words can be: Deck, Pool, Granite, Remodeled, New Windows, and more. I see listings all the time that frankly read very boring. Nothing in the dialog reaches out and says “come see me NOW”. Make sure that lots of pictures are used and the are taken with logic. What I mean here is counters should be clear, toilet seats should be down and certainly make sure that solid yellow line in the street doesn’t show. Then the price should be positioned logically. For example, don’t set a price at $399,900. Why? Let me ask you; when you go to the Internet, how do you search for properties when price is a factor. What I’m getting at is prices are usually in $50k increments. People may search $350,000 to $400,000 and they may search $400,000 to $450,000. You should price your home at $400,000. That way you show up in both search categories. Don’t let $100 keep you from missing the eyeballs of your buyer.

5. Your Secret Weapon is a Speedy Deal.

For those looking at short sale properties, they quickly become aware that this process can take months. Make sure your agent lets potential buyers know that you can close a deal within a few weeks. This is especially important given the limited time the first time home buyer tax credit is available. To qualify for that credit you need to purchase and close your transaction prior to December 1st of this year. Other things to consider is to offer financial help with paying closing costs or consider throwing in new appliances or a fresh paint job.

In this market a home HAS to stand out. It HAS to be priced well and its very important to help they buyer feel like they are getting a great DEAL or they may not buy.

Oregon Foreclosures

Recently many banks and other institutions such as Fannie Mae, have removed their foreclosure moratoriums which was bound to have the impact of increased foreclosures flooding the market. Well it has impacted the Oregon real estate market. In March we saw foreclosures rise more than 100% from the month of March, 2008! Up 107%, a total of 3,388 homes went into foreclosure. This works out to 1 in every 594 homes. Remember, those are numbers for one month alone. Oregon actually fared worse than the rest of the nation which saw a 46% increase for the same period. These numbers are compiled and reported by RealtyTrac, a company that tracks foreclosures across the country.

For the first quarter of 2009, Oregon owned the nations 10th position of the worst foreclosure rate. We were 12th in the nation in March alone. This certainly has to be a reflection of our unemployement numbers as we are number 2 there in the nation. The nations worst unemployement rate is in Michigan where the auto industry dominates.

Foreclosures by Oregon county breaks down as follows:
Multnomah (648)
Deschutes (471)
Washington (407)
Jackson (320)
Clackamas (295)
Marion ( 265)
Lane (200)
Linn (123)
Yamhil (97)
Josephine (93)

New Listing on Bull Mountain

I just listed a gorgeous home at 14846 SW Lookout Drive in Arbor Summit on Bull Mountain. Built in 2006, the home is in “like-new” condition and shows like a model! Some of the ammenities include:

• Hardwood Floors
• Slab Granite Counters
• Dream Kitchen!
• Stainless Appliances
• Knotty Alder Cabinets
• 4 Bedroom + Large Bonus Room

These sellers will even consider a trade for newer or nicely updated single level home. Bull Mountain is located in Tigard Oregon in Washington County, approximatly 10 miles southwest of Portland.  The Elementary School here is Alberta Rider and is actually walking distance from this home! The High School this home feeds into is Tualatin which has a ratio of 18 students per full time teacher which compares to a state average of 21 students per full time teacher. The home is 2920 square feet and is listed for $550,000. For additional information contact Steve at 503-780-7599 or Steve@SteveSchwabGroup.com.

2 Years and Counting

For some reason I saved an MSNBC news story from June 19th 2007, almost 2 years ago, which discusses the housing downturn at that time and questioned whether or not we were close to the bottom. Almost 2 years later we still don’t know when we will find the bottom. Written by John W. Schoen, Senior Producer for msnbc.com and Titled: Housing industry still looking for the bottom, the article focuses a bit on the impacts the downturn was having on homebuilders. An interesting point made in the article was that Builders perceptions of the market at the time was at a 16 year low, the sharpest decline since 1991. The survey was taken at a time we saw new, privately-owned housing starts to be off about 22% from the prior year, or about 1.5M starts. Taking  look at todays data on new residential construction as reported on the U.S. Census Bureau website, privately-owned housing starts for February 2009 were at 583,000, almost 1 million below that of May of 2007! This may beg the question: what does this mean to Builders perceptions today, but we all probably know the answer to that question. This video, pulled from the article gives further perspective of where we were at the time and specifically talks about California needing to go even lower as it was requiring and income of at least $100K to qualify for the purchase of the average home. I believe that as soon as we see job losses begin to level, that it will be at that point the housing market will begin to move. Just like the stock market, the bottom of the housing market cannot be predicted.

Today in the Beaverton Oregon area of Washington County, easily 63% of the sales activity is below $300,000 and less than 10% is above $500,000. The price points above $450,000 are almost non-existent, clearly a factor of a weak job market. The “move-up” buyer who would be purchasing the $500,000 home is very probably sitting on the side lines, waiting to see if thier job will survive this recession. With a stronger job market and a pick up of the higher price points, I think we’ll see the result lead us into a stong recovery.

Interest Rates at record lows – Is it time to buy??

The answer to that question is a straight forward YES! Just today Freddie Mac, who’s job it is to connect Wall Street and main street with mortgage purchases and portfolio investment activities, reported that 30-year fixed-rate mortgage (FRM) averaged 4.78 percent with an average 0.7 point for the week ending April 2, 2009, down from last week when it averaged 4.85 percent. Last year at this time, the 30-year FRM averaged 5.88 percent. The 30-year FRM has not been lower in the life of Freddie Mac’s weekly survey, which dates back to 1971 for the 30-year FRM.

In the Portland area real estate market, prices have gotten softer, as we’ve seen in other areas of the country. The benefit we’ve had over areas such as Las Vegas, Phoenix, southern Florida, etc, is that we didn’t appreciates as fast and as fast and as much during the boom and as a result, we may not have as far to fall. In the past 12 months for example, the average and median sales price in the greater Portland area has decreased between 5% and 6%, considerably less that 20% to 55% in other areas.

Also in April, The National Association of Realtors (NAR) has reported an increase in pending home sales which suggests a possible upswing in sales activity in the coming months. Lawrence Yun, NAR Chief economist is quoted as saying: “Pending home sales have a way to go for there to be a meaningful increase, but the increases in shopping activity are hopeful indicators that we’ll see additional gains”. Yun goes on to say, “More buyers are getting into the market to take advantage of stimulus incentives and much improved housing affordability conditions, but it will take a few months before we could see this turn up in measurable sales contract activity.”

Despite what may be interpreted from watching the evening news, homes are selling! Don’t be afraid to jump in, especially if you are a first time home buyer!

Portland – Forbes: America’s Best Long Term Real Estate Bets!

Check out Forbes Magazine; America’s Best Long-Term Real Estate Bets! We’re number 9! Forbes.comevaluated the country’s 40 largest Census-defined metro areas using the last 25 years of NAHB data.  They examined new construction and vacancy rates to calculate historical

Portland Oregon Along the Willamette River

fluctuations in supply and demand against national averages. Moody’s Economy.com provided job-growth forecasts through 2017.  Job-growth projections 2008-2017: 1%

In the housing realm, Portland’s conservative building patterns and vacancy fluctuation, which rank 17th and 19th, respectively, help make for a steady market. It won’t likely ever be the sort of market where flippers can make huge profits, but this kind of stability is a bonus on down times. Frankly its the market that is easy to flip in that can be a volatile environment to live in. There was a time when you could buy and flip in the Portland area and make a nice profit. Try and do it now and risk loosing it all.

Yes, we have pockets of problems in our real estate market, what city doesn’t? But if your desire is to live in a beautiful area of the country, the Pacific Northwest is tough to beat.

Trouble Making Mortgage Payments?

Beginning in October of 2008, the Bush Administration rolled out an assistance program for homeowners having trouble making their mortgage payment. The Hope for Homeowners Program restructures mortgages for qualified homeowners.

Restructured loans will be based on 90 percent of a homes current value which is established by a new appraisal. What you are accomplishing here is basically a refinance of your home with a 30 year fixed rate FHA loan. The maximum loan amount is $550,440 and MIP insurance is obviously required. Additional information can be found at: http://www.hud.gov/hopeforhomeowners/.

What to do: First, contact your mortage lender immediately to try and negotiate lower payments. You need to be persistent; lenders are currently overwhelmed with people in this situation, and tend to work with those in default first. If you are trying to sell your home but can’t get an offer that at least matches what you owe, ask the lender if they will agree to a short sale. This basically means they will accept a lesser amount and may be your last resort before foreclosure. A qualified Real Estate Brokercan explain this process further. Ask your Real Estate Broker to help you with comparables which will demonstrate to the lender that your home is worth less than the unpaid balance.

This is a difficult and trying process. Remember if you are in this situation, you are not alone.

Pricing Your Home in The New World of Real Estate

I’ll sit in sales meetings from time to time and listen to other Realtors, those who have been in the business for a lengthy time, talk about “how things use to be”. Clearly much about how real estate is transacted today differs from only 10 years ago. It seems it is still changing almost every day. We no longer use the thick book with proprietary information and because of the application of the Internet, homes can now be eliminated before you may even put your client in the car. The issue I’m planning to discuss here is relevant in any real estate market, whether it’s Beaverton Oregon, Portland Oregon or Miami Florida.

I want to touch a bit on marketing technique in this post and specifically on what price you and your agent may choose to represent your home at. It seems as long as I can remember, pricing strategy, for just about any product has been designed to either fool, or soften the blow to the general public. Specifically what I’m saying is that rather than price the box of cereal at $5, it may get priced at $4.96, or rather than price a gallon of gas at $3.00, it gets priced at $2.99 & 9/10.

Pricing a home has also followed this same logic. Rather than price at the even $500,000, we would price them at $499,900. It seems the number four at the front makes the “shopper” feel better. Because the greater portion of the population starts their search on the Internet, it is critical that your home stands out from all of the other inventory as much as possible. Presentation as it pertains to staging, smell, aesthetics are things that primarily you, the home seller can, and should control. The professional and experienced Real Estate Broker will have a clear, well designed Marketing Plan which should be designed to attract the buyers out there. 

When the public first approaches a website to begin their search, they generally have at least one primary criteria. That criteria is price. If a website doesn’t already have search parameters for pricing already set, the public will probably set their own anyway. What I mean is a person could be have a criteria of homes priced between $500,000 and $550,000. If the site has preset search parameters set for maybe $500,000 to $525,000 or maybe $500,00 to $550,000, this “house hunter” may not consider expanding those parameters.The risk here is, the perfect home, maybe the home you are wanting to sell, is priced at $499,990. If that buyer does not think to expand their criteria, they may miss the opportunity to see your home depicted on their computer screen, only because there was a $10 difference. Yes, a $10 bill could have been all that came between the perfect buyer seeing your home or not seeing your home!

Many factors are considered when pricing and I won’t go into all those factors here. But I want to point out a strategy you should possibly consider. If you agree with your agent that you want to market at $400,000, consider fighting off the urge to price at $399,900. Consider if there is risk in having $100 cause you to loose two important eyeballs in a transaction of almost a half million dollars. While I’m not a trained psychologist, I can’t speak to the logic of the buyer focusing on the number 3 in that pricing strategy. I will submit that the serious buyer is not so concerned if the asking price begins with a 3 or a 4. They very well may be more concerned with the quality of the photographs and the tone of the written description.

The moral of the story: Price Smart and Get it Sold!

Is There Hope for Home Prices?

We are deffinetly seeing real estate prices fall around the country. What was once viewed as the best long term investment a person could make has changed course, at least for now. According to The National Association of Realtors, home prices were trending down until late in the first quarter of 2008 where a bit of an upturn was seen as we went into the spring time selling season. As we began to see additional signs of problems with the economy, we then saw these prices plumet and we continue to see them drop. The catalyst to these drops seemed to be a result of the problems at Fannie Mae and Freddie Mac, which after the government take over we saw mortgage rates go lower for a brief period. Then came the bankruptcy of Lehman Brothers, the failure of Washington Mutual and the planned sale of Wachovia, followed quickly by huge stock market sell-offs and the next result was an increase in mortgage rates, which is never a good thing for home sales. Now, while things like interest rates and availability of money in the form of loans can have a bearing on home sales, the upward pressure as well as downward pressure of prices is a simple by product of supply and demand, much like a stock. The Portland area saw a shift in our market in the winter of 2008. If you look at the chart to the left, you will notice a change in monthly inventory numbers, which became pronounced in around September of 2007. A real estate market is determined to be normalized, by that I mean it’s neither a buyers or a sellers market when inventory is in the 6 month range. In this chart you can clearly see how throughout most of 2006, we had a clear sellers market, and yes, prices went up. As you look at 2008 it has clearly swung to a buyers market with 5 our of the 9 months indicated here showing double digit inventory levels, and yes, we are seeing prices decrease. To see a shift take place again, scarcity of homes needs to re-enter the equation.

Will a further reduction in interest rates help? What do you think? Or, is this the beginning of the perfect storm with growing U.S. job losses, continued stock market sell off, huge corporations asking for bail outs and foreclosures at record levels and growing? Your thoughts are welcome here. Did we see the tipping point reached with fuel prices shooting through the roof (although they’ve pulled back a bit now)? Can most of it be blamed on: “it’s an election year” or is nervousness, and negativity our own worst enemy?

One thing is for certain. The near term future for the health of our overall economy is uncertain. I believe we will see it get better, but I also believe it will get worse before that happens. Where we all tend to be nervous is in considering how long the season of decline will be with us. 

 

Fannie Mae to Require Counceling to Borrowers

Effective January1st, 2009, first time home buyers who have lower credit scores or are looking at a loan taylored for low or moderate income buyers, will need to receiving home ownership counciling. While Fannie Mae already requires pre-purchase counceling for borrowers purchasing a 2 or 4 unit property using a MyCommunityMortgage loan, this new requirement will be a reinstatment for the first time home buyer.

Counceling topics will include: budgeting, management of credit, selecting a home, and obtaining a mortgage. The home buyer will receive a personalized assessment of thier finances and readiness for home ownership. The process will even go further to analize thier credit history and current financial situation. This seems to be a welcome improvement to the lending process, when in the not too distant past, all a person had to do was sober up for 20 minutes, fog a mirror and they qualified for a loan.

Counceling can be completed in a face to face situation, over the phone or online. Strict guidlines for standards have been established by the National Industry Standards for Homeownership Education and Counceling. 

Fannie Mae has a tool on thier website which can be used to find a councelor. To find it go to www.fanniemae.com